I dreamed of Ali last night. We were in a ring, fighting someplace. In the seventh round, the seventh or eighth, he was saying, "Don't knock me out.... Don't knock me out!" I says to him, "You gotta get out of here, man. You gotta get the hell out of here!" And then the next thing I remember is we was standing together under a tree, the best of friends. That's what I dreamed last night.

It's almost nine o'clock at night, and Larry Holmes is sitting in the driver's seat of his white Continental Mark VI, his left foot stuck out the open door, the other hitched up on the sill, the receiver of a radiotelephone pressed to his ear. The world heavyweight champion is parked on the shoulder of an interstate in northern New Jersey, with the Manhattan skyline rising in the distance, with semis rushing past 10 feet away and with a heavy smell of gasoline all around him. He is talking to the operator.

"This is Larry Holmes, right," he says. "I got a problem. Can you help me?"

A few minutes earlier Holmes had been hustling to New York for an appearance on Good Morning America to promote his Oct. 2 fight against Muhammad Ali. Holmes' brother Jake had been driving in the fast lane—with Larry resting in the backseat and the champion's manager-trainer, Richie Giachetti, trailing them at 65 mph in another white Continental—when the lead car struck a piece of pipe lying on the road. It ricocheted upward under the car, driving a hole in the gas tank, then kicked back down onto the pavement and went flipping away end over end, lighting up like a sparkler as it skated across the concrete. Giachetti followed Holmes' Mark VI as it pulled off" the road, leaped from his Lincoln as it skidded to a halt in the gasoline slick and ran to the back door of the other car.

Gas was still gushing, as from an open faucet, out of the tank. "Get out! Gas is leaking! Gas is leaking!" shouted Giachetti, who used to build stock cars and knows too well what hot metal and high-octane fumes can mean.

Holmes clambered out and strode quickly up the road, looking behind him as he walked. They waited 10 minutes for a state trooper, but only mosquitoes came. "They're eatin' me up out here!" Holmes cried. "The heavyweight champion...." Holmes briefly shadowboxed, flicking jabs at his humming ultraflyweight opponents, and then headed back to his car. "I'm going to call a tow truck," he said.

So now he's sitting in a knocked-out car, inhaling gas fumes and trying to call for help above the roar of the semis. "My car broke down," he says. "Can you get me a tow truck? Yeah.... We're on 95, near Exit 16.... What?" After a moment's silence his voice rises in mock disbelief.

"How can Ali knock me out?" Holmes says to the operator. "How can he? He hasn't knocked anyone out in more than four years! How can Ali knock anyone out? The fight won't go 10. Believe me.... Can you bet money? Yeah. Bet a thousand. I'll guarantee it for you. Believe me...."

Holmes hangs up, shakes his head and shrugs. "You call for help," he says, "and all they want to know is if you can go eight rounds with Muhammad Ali."

There are few places Holmes can go these days where he isn't asked about his fight against Ali. From the shoulders of roads to TV studios to the streets of the cities he visits, Ali stalks him. Indeed, there is nowhere on earth, not even in his dreams, that Ali's presence doesn't hover near, reminding Holmes, himself one of Ali's great admirers, that he succeeded the most charismatic figure in American sport.

Following in Ali's wake has served to diminish Holmes' star, to deny him the recognition he feels is his due. Holmes has been the World Boxing Council's heavyweight champion for more than two years, ever since June 9, 1978, when he took the title from Ken Norton in a stirring, bitter tight in Las Vegas. Yet even today, 28 months and seven straight knockouts later, Holmes still suffers from lack of recognition, even of respect, and that hurts.

There was the morning Holmes walked through McCarran International Airport in Las Vegas, and a man, spotting him, said to his girl, loud enough for the champ to hear, "Hey, there's Ernie Holmes." It wasn't the first time that Larry had heard himself confused with the former Pittsburgh Steeler lineman. Turning, he shouted in mock menace at the man, "You watch your mouth, you hear? I don't play football." Wheeling about, managing a laugh: "Did you hear that? Did you hear that?"

And there was the girl, backstage in the Good Morning America studio, who introduced him to a colleague thusly: "This is George Foreman...." Holmes smiled, but the comment brought Holmes' interviewer, Tom Sullivan, to his feet, aghast and apologetic. "What a horrible thing to say," said Sullivan.

And there was Sonny Simmons, the promoter of the Allentown (Pa.) Fair, who introduced Holmes to his daughters as "the next heavyweight champion." "I am the world heavyweight champion," Holmes said.

Earlier this month, during a promotion held at a movie studio in Burbank, Calif., Holmes boxed a few rounds with sparring partner LeRoy Diggs in the ring where some of the fight scenes in Rocky II were filmed. During the session, there was an annoying hum in the air as members of the audience conversed, drifted over to a beer-and-sandwich table and walked on and off the set. The sparring done, the sweating Holmes paced about the ring. "I think I deserve a little respect," he shouted to the crowd. "I don't put on airs. I am me. I don't go around bragging and boasting. Give a fellow his just due and respect. I shouldn't have to be here telling you who's the best heavyweight in the world today. You should realize it when you see it. If you don't see it, you should wear glasses, because I'm telling you like it is, in living color. I'm for real.... Ali has fooled all you people so long, for so many years, and you've got so addicted to his trickerations that he plays on all of you, on all your minds. If you bet on that fool, you're just throwing your money away. Bet on me and support me because I'm the heavyweight champion of the world...whether you like it or not!" Holmes seemed to be expressing the frustration and anger he had felt since he became a contender, since he first beat Earnie Shavers in 1978, since he won the title only 2½ months later. "He wants to be known," his brother Jake says. "It hurts him when he isn't. The anger continues in Larry."

Most of whatever else Holmes ever wanted is now his. Money and a family are his, and so is a sense of permanence and place. With all that has emerged a feeling of independence, a growing confidence that he can be his own man. "I worked at being heavyweight champion of the world," Holmes says. "I worked at being me, being myself. I truly worked at it." In fact, since he first turned pro and began his climb to the top, Holmes has been determinedly building for himself the kind of life that he had dreamed of having.

The center of his world is Easton, Pa., a working-class city of 29,450 people at the confluence of the Delaware and Lehigh rivers. During the Industrial Revolution the railroads, factories and mills turned the Pennsylvania Dutch farming community into an ethnic melting pot, drawing to its hills the Irish, Italians, Scots, Germans and Lebanese. Most of the valley's blacks didn't come there until after World War II; among them was the family of John and Flossie Holmes, up from Cuthbert, Ga.

Larry was five at the time, the seventh of 12 children. His father, unable to support the family, left home when Larry was a boy. His mother raised all of them. A hell-raiser and school-yard ruffian, Holmes made it to only the seventh grade. "I had a choice," he says, "quit or get thrown out." He was 13 when he left school and has been working ever since. At first he shined shoes for 15¬¨¬®¬¨¢ plus tips. "I'd start at five in the morning and end about 11 at night, make 10 bucks and be happy with it," he says. Then he worked in a car wash and later in a rug mill, and played a lot of blackjack and poker at night. Holmes grew up in a hurry. At 16 he was living with a woman seven years his senior, and at 17 he was the father of a baby girl. At 18 he was the father of another. He worked in a foundry, first sweeping floors, then pouring steel and making shell casings. And he played. He bought himself a Plymouth Roadrunner convertible, drove it stock during the week and on weekends opened up the pipes, slapped on fat tires and went racing. "Fastest convertible in town," he says. He learned to fight at St. Anthony's Youth Center in the heart of Easton. By 1972 Holmes was almost good enough to make the U.S. Olympic team. Duane Bobick beat him in the finals.

Holmes turned pro in 1973 and soon found himself under the care of Don King and his Cleveland associate in the fight game, Giachetti, a tough citizen who ran an auto-body business, owned and operated a bar and often hung out around the district attorney's office and police department, fixing traffic tickets for wayward drivers. "I had connections," Giachetti says. King didn't know much about the fight game, at least as a sweet science, but Giachetti did. He was a veteran of 80 amateur fights and had been the Cleveland Golden Gloves open novice welterweight champ in 1961. When King later became a big-time promoter, he and Giachetti broke their formal business relationship. Giachetti drifted away from the auto-body business in Cleveland—leaving his brother to run it—and increasingly devoted himself to Holmes.

"He was a kid who needed somebody to understand him, to be with him," Giachetti says. "He needed a friend at that time more than anything else. He needed somebody to have confidence in him and who cared about him."

The kid was good, too. He had quick hands, a classic jab and a willingness to pay the price. In arenas, he paid it mostly on undercards; in the gym, he paid it as a sparring partner for the heavies in the heavyweight division—Shavers, Joe Frazier, Ali. It was in Ali's camps around the world that Holmes honed his skills and came under the spell of that strange man who floated in the ring, recited doggerel and carried on great conversations with himself. "I used to think Ali was crazy," Holmes says. "I used to watch him all the time, like a hawk—watch him walk, watch him eat, watch him talk. He used to say all those things. He used to say, 'I wrestle with an alligator, tussle with a whale, handcuff lightning, throw thunder in jail!' I really thought the man was crazy. He came with me to Easton one day to make a speech at a school, and I heard him talking to himself on the bus. He was saying, 'I'm one bad nigger.' "

While Ali took him around the world, to places like Zaire and Manila, Holmes always reached back to Easton for support. He and Giachetti grew close. Luis Rodriquez, a light heavyweight from Bethlehem, whom Holmes had known since they were amateurs together, was his sparring partner. And he hired Charles Spaziani, the former district attorney of Northampton County, Pa., as his lawyer and financial adviser. They had first become friends in 1968, at a time of racial unrest in Easton. "Some of the police officers were overzealous," says Spaziani, who was then DA. "They went out and picked up every black on the street." Holmes was walking out of the State Theatre when police grabbed him, accused him of being part of a group of troublemakers and took him to the station. The next day, after posting bond, Holmes went to Spaziani's office and pleaded his innocence. Spaziani had the matter investigated, found that Holmes was telling the truth and had the bond returned to him, along with an apology from the mayor. It was Spaziani and Giachetti, more than anyone, who guided Holmes in those early days—Giachetti as manager, cornerman and trainer, Spaziani as counselor and friend.

Holmes says he relied on their judgment because he had to. "When you're coming up, you have to do that," he says. "I couldn't call the shots because I wasn't in a position to call the shots. I had no money. I had no other place to go."

But he has the money now. And he is 30 years old, no longer a young man, and taking firmer charge of his affairs, in and out of the ring. Holmes still regards Spaziani as a friend, but they have had their differences. Giachetti is still listed as Holmes' manager as well as trainer, but he is far more the latter than the former, and his influence on Holmes is not nearly what it once was. "Richie used to choose the sparring partners and used to take care of the payroll," says Jake Holmes. "He decided what to pay the sparring partners, even us. If Richie wanted Larry to spar four rounds, he sparred four rounds. If he wanted him to go 15, he went 15." Holmes now makes these decisions.

"Larry used to figure he couldn't do those things on his own," Jake says. "Confidence is the only word I can find for it. Now he's finding he can do it on his own. Larry demands more. If he's paying you and he wants you to do something, you got to do it. Two years ago, if you didn't do something he asked you to do, he'd say, 'Oh, O.K.' Now he wants to know why. 'Why you keeping me hangin'?' He has taken control of his life—taken responsibility to himself."

According to his family and friends, Holmes is a man in transition, growing more up than away. But, as relationships have changed, feelings have been hurt and egos bruised. "I've heard people say that Larry has grown apart from his friends, people who've been with him a long time, but I don't see it that way," says Rodriquez, who is now Holmes' public-relations man. "I see it as Larry maturing, coming to terms with himself and realizing he's just as capable as the people around him. The people he had depended on and confided in are now having difficulty coming to terms with the fact that Larry doesn't need them as much as he used to. It hurts them because they haven't come to terms with it. I have...finally."

Since King began taking a more active interest in Holmes' flourishing career, he has clearly won Holmes' loyalty and become a shaping influence in his affairs as a fighter. Giachetti is silent on the internal politics of the Holmes camp, especially on the role of King, but clearly the former partners from Cleveland are at odds. Equally clearly, Holmes now leans toward King. "Richie don't like a lot of things I do with Don, I'll tell you that," Holmes says. "Spaz don't like a lot of things I do with Don." The most recent thing they did not like, Holmes says, was his and King's decision to fight Ali. Holmes claims he will make between $4 million and $6 million for the fight: Ali boasts about an $8 million payday for himself.

"They went against me on that," Holmes says. "They told me I should make more money. But I don't care about making more money. I used to fight for $150. How are you going to turn down $4 million? How are you going to turn down $2 million? A million? When I fought Scott LeDoux I got $925,000. They didn't like that. They thought I should have gotten a million and a half. Don said, 'I can't give you a million and a half.' I said, 'Give me what you can.' They say Don's exploiting me. But I trust Don. I will sign a blank contract and give it to him. I like to think Don is my friend.

"Richie is good in the corner," says Holmes. "He is a worker. I am a boss. I want him to know he's not my boss. I want him to know I'm not his robot, like he used to think I was. Spaz, too. Those guys work for me, whether they accept it or not. I pay them. They don't take the shots. If I have to take the shots, why can't I call 'em? I could be wrong, I don't know, but they think because I had only a seventh-grade education that they know more than I do."

There is a tone of impatience in Holmes' voice now, one that promises even more changes. "Think Richie's going to quit? Think Spaz is going to quit?" he says. "They're going to get a couple of hundred thousand every time I step into the ring. Where are they going to make a million a year at? They're not going to make it no more. I'm going to take over the money. They're not going to get those big percentages anymore. Starting this fight. Richie might not know it; Spaz might not know it. They're going to get paid good money. But out of $4 million, think I'm going to give them $500,000? That's crazy."

And no, says Holmes, he hasn't forgotten all those days and nights he spent with Giachetti on the road. "I like Richie a lot, probably more than he thinks I do," Holmes says. "He helps me a lot. We slept in the same rooms. We sacrificed many days away from home. But I don't owe him nothing. He sacrificed for the same thing I did. And what was that? Money. He's been well taken care of. He's made a million dollars. I paid my way."

Holmes still is paying. After scratching and struggling all those years, in fact, he is paying his way all over Easton. He has committed himself financially to the city, not only as a taxpayer, but also as a builder, benefactor and businessman. Holmes has made the town his own because he likes it, feeling comfort in its familiar places. He knows many of its inhabitants and can walk down a street without being hounded for autographs. He likes the town square, where farmers come to sell their produce, where townspeople congregate and where the Civil War memorial, a stone obelisk crowned by a bugler, rises high in the air.

Holmes likes towns with formal centers. "Every town should have a circle," he says. "When you go to a town and don't see a circle, you wonder, 'Damn, what's wrong here?' "

The whole Holmes clan, Flossie and her sons and daughters, still lives in Easton or nearby. When home, Holmes talks to his mother every day, either calling or swinging by, and on holidays the family usually gets together. He has bought his mother a house and helped Jake buy one next door to hers. "I can handle any situation that comes up, because I have my family with me," Holmes says. "Nobody bothers us. People don't mess with me. I'm not black anymore because I've got a few dollars. When you got some money you're not considered as black. We can do what we want to do, go where we want to go. I can be comfortable with my family, give my kids a good education—something I didn't have—give them opportunities. I been damn near around the world, and I wouldn't live outside this valley. When I run in the morning, kids going to school see me and say, 'Good morning, champ!' I'm satisfied here doing what I'm doing."

What he's doing, for one thing, is building a $500,000 showplace of a home set on 2½ acres of wooded land, a refuge befitting a man worth more than $3 million and looking forward to retiring on the interest. It has nine bathrooms, two Jacuzzis, four bedrooms, a 4½-car garage and an indoor swimming pool shaped like a boxing glove. One of the Jacuzzis is in the thumb.

Moving through bare studs, beneath the framed-in skylights and among the skeletons of rooms-to-be, Holmes sounds like a tour guide. "Moving right along," he says, stepping smartly down unfinished hallways, through a series of doorframes. "This is the master bedroom, here's the powder room and bath.... Over here's a sewing room, for my wife to sew.... Here's the kitchen, where I'll get fat.... Moving right along.... Here's my den, bulletproof and soundproof.... Here's the skylight, where the sun shines in." The Holmes family—Larry and his wife, Diane, and their 7-month-old baby, Kandy Larie—hopes to move in next month, shortly after Holmes gets back from the Ali fight. He is also fixing up bedrooms for Misty, 12, and Lisa, 11, the daughters he fathered as a teen-ager.

"I can do anything I want here," Holmes says. "I can swim here, get in my steam room here, lift weights and go roller skating on the tennis courts. I wanted my place like this; it's a dream come true."

He has also wanted, for many years, to own a disco, so this year he bought one almost ready-made, for $135,000, about a block from the town square. He plans to call it Round One and to install his 29-year-old brother, Bob, a serious-minded baker, as its manager. The disco is also scheduled to be ready this fall. The day after he bought it, Holmes was standing behind the bar and looking about the deserted rooms. Winking, Holmes slapped the bar and shouted to an empty room, "All right, everybody, a drink on the house!"

Bob Holmes' quiet voice carried from the rear of the place. "No, no," he said. "No drinks on the house."

Holmes has also spent $100,000 to buy land and build a gymnasium on it. The foundation has been laid, and it, too, will open this fall. "I don't know what I'm going to do with it," Holmes says. "I'm just putting it up. It's not to make money. How are you going to make money from a gymnasium?" Most likely, he says, it will be used as a kind of local recreation center for kids, perhaps as a meeting place for adults. "It'll have a boxing program," Holmes says. "And an under-21 club. Dancing on Friday and Saturday nights. Kids don't have nowhere to go."

Holmes has been running his affairs out of a two-room office a block from the square. He laughs at the thought of the operation. "I'm playing big shot on the seventh floor of the Alpha Building," he says. He has a secretary, Dawn Lahr, brother Jake takes care of security, old pal Luis does the P.R., and a childhood friend of Holmes', Eddie Sutton, comes by to do whatever else needs to be done. "I'm creating jobs," Holmes says. "I go in there and say, 'Hey, anything happenin'?' 'No, Larry, not today.' Know what I mean? But I need it in a way for a tax writeoff, and they need jobs. Playing big shot—that's all I'm doing. I ain't on cloud nine. I'm down here on earth."

Which is where he intends to be come Oct. 2, when he climbs into the ring at Caesars Palace to defend his title against a 38-year-old man who needs the money. In a way, Ali's return is testimony to the problem that has been tracking Holmes since he won the title. Only in the heavyweight division—except for Holmes one devoid of real talent—could the prospect of Ali's comeback be taken all that seriously. With the retirement of Ali, Frazier, Foreman and, for the time being, Norton—Holmes' last worthy opponent—the champ has taken on fighters such as Ossie Ocasio, Lorenzo Zanon, LeRoy Jones and poor LeDoux. Holmes so outclassed the last two in his most recent fights that the bouts amounted to hardly more than public floggings.

"It's not my problem, not my fault, that I'm the best right now," Holmes says. "I fight the top people that there is to fight. I knock them out as soon as they bring them to me. I'm not going to say I'm going to be here forever. I'm not; I'm no fool. I go with what's real today. When I was a kid, I believed in Superman. I used to dream I'd be the strongest man in the world, bend steel and all that. All dreams, man. It ain't real. The only thing real is what you can touch, see, feel, hear. I'm real. I'm here for now. Ali was yesterday. This is Larry Holmes' time: 1980."

Considering how much Holmes wants to be recognized and respected, to be admired as a fighter, there is sad irony in the fact that this fight, the one for which he probably will be best remembered, can gain him nothing at all in terms of esteem. He will get ignominy if he loses, shrugs if he wins. Holmes didn't want to fight Ali, he says, but the money was more than good, and there was no way he could refuse the match. "If I don't fight him, I sound scared of him, like I'm ducking him, and he'd go fight someone else," Holmes says. "And I'd live the rest of my life not fighting Ali. If I don't fight him, it kills me. Can you see my kids going to college a few years from now, and someone says, 'This is Lisa Holmes; Larry Holmes is her dad. Remember Holmes, the heavyweight champ? He was scared to fight Muhammad Ali, the old man.' "

Holmes laughs, pondering his fate. "If I thought for one minute that Ali could whip me, I wouldn't fight him. I don't need the embarrassment. My kids are growing up, and they don't need it at school. But I'm in a no-win situation. This fight is to shut people up. But it's a no-win. People are going to downgrade me for beating up on this old man. But there's a lot of pride involved. A lot of pride. When I knock this sucker out, I'm going to be happy, but I'm still going to lose. They're still going to hate Larry Holmes."

The dilemma is unresolvable. Holmes understands it perfectly and deals with it well. It's as if he's fighting a ghost haunting the house the ghost used to own. "He's real," Holmes says, "but he ain't there anymore." Yet Ali is wherever Holmes goes these days—on the telephone beside a thundering road in New Jersey, in a TV studio, in Holmes' dreams. During a recent TV interview, in New York, a tape of an Ali harangue was shown over Holmes' shoulder as he talked. There was Ali, the consummate clown, vowing to win the title a fourth time, shouting "Holmes! Holmes! Four times, Holmes! I eat Holmes, I sleep Holmes, I need Holmes!" And then putting a hand to his eyes as if weeping, Ali starts crying about how badly he needs Holmes and how much he wants Holmes, finally, in a feigned sob, saying, "I get so emotional." It was a hilarious performance, vintage Ali, and Holmes laughed all the way back to the hotel. "I'll tell you, man," Holmes said. "I really think he's funny. Honest to God, I do. I really like him. What he does is funny, man. I don't care what anybody says. It's funny."

A short time later, Holmes was standing on Central Park South when up the street, coming toward him, came the old ghost himself, materializing right there in front of the St. Moritz Hotel. Holmes saw him coming far away, but he waited because he wanted to hear the act once more, wanted to hear Ali say what he knew Ali would say. "Holmes!" Ali shouted. "Four times, Holmes! Holmes! I want Holmes!" A crowd gathered as the two men met. The Ali fight may not be the one the champion wants, but it may carry compensations beyond the purse. When all is said and written, Holmes may have heard himself called Ernie for the last time. Ali had it right, as usual. Surrounded by the crowd in front of the St. Moritz, he turned to Holmes and quietly said, "We're stoppin' the world, ain't we?"